Corecivic (NYSE:CXW) versus Kilroy Realty (NYSE:KRC) Head to Head Review

Corecivic (NYSE:CXW) and Kilroy Realty (NYSE:KRC) are both mid-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, risk, institutional ownership, profitability, analyst recommendations and valuation.

Dividends

Corecivic pays an annual dividend of $1.76 per share and has a dividend yield of 7.4%. Kilroy Realty pays an annual dividend of $1.82 per share and has a dividend yield of 2.4%. Corecivic pays out 76.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Kilroy Realty pays out 52.3% of its earnings in the form of a dividend. Kilroy Realty has raised its dividend for 3 consecutive years.

Valuation & Earnings

This table compares Corecivic and Kilroy Realty’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Corecivic $1.84 billion 1.55 $159.21 million $2.31 10.32
Kilroy Realty $747.30 million 10.40 $258.41 million $3.48 22.12

Kilroy Realty has lower revenue, but higher earnings than Corecivic. Corecivic is trading at a lower price-to-earnings ratio than Kilroy Realty, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

80.7% of Corecivic shares are owned by institutional investors. Comparatively, 96.7% of Kilroy Realty shares are owned by institutional investors. 1.2% of Corecivic shares are owned by company insiders. Comparatively, 2.3% of Kilroy Realty shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and price targets for Corecivic and Kilroy Realty, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Corecivic 0 1 0 0 2.00
Kilroy Realty 0 3 4 0 2.57

Corecivic presently has a consensus target price of $24.00, suggesting a potential upside of 0.67%. Kilroy Realty has a consensus target price of $80.60, suggesting a potential upside of 4.70%. Given Kilroy Realty’s stronger consensus rating and higher possible upside, analysts plainly believe Kilroy Realty is more favorable than Corecivic.

Profitability

This table compares Corecivic and Kilroy Realty’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Corecivic 9.09% 12.72% 5.06%
Kilroy Realty 33.84% 6.27% 3.39%

Risk & Volatility

Corecivic has a beta of 1.18, indicating that its share price is 18% more volatile than the S&P 500. Comparatively, Kilroy Realty has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500.

Summary

Kilroy Realty beats Corecivic on 12 of the 17 factors compared between the two stocks.

Corecivic Company Profile

CoreCivic is a diversified government solutions company with the scale and experience needed to solve tough government challenges in flexible cost-effective ways. We provide a broad range of solutions to government partners that serve the public good through corrections and detention management, a growing network of residential reentry centers to help address America's recidivism crisis, and government real estate solutions. We are a publicly traded real estate investment trust (REIT) and the nation's largest owner of partnership correctional, detention and residential reentry facilities. We also believe we are the largest private owner of real estate used by U.S. government agencies. The Company has been a flexible and dependable partner for government for more than 35 years. Our employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good.

Kilroy Realty Company Profile

Kilroy Realty Corporation (KRC), a publicly traded real estate investment trust and member of the S&P MidCap 400 Index, is one of the West Coast's premier landlords. The company has over 70 years of experience developing, acquiring and managing office and mixed-use real estate assets. The company provides physical work environments that foster creativity and productivity and serves a broad roster of dynamic, innovation-driven tenants, including technology, entertainment, digital media and health care companies. At December 31, 2018, the company's stabilized portfolio totaled approximately 13.2 million square feet of office space located in the coastal regions of Los Angeles, Orange County, San Diego, the San Francisco Bay Area and Greater Seattle and 200 residential units located in the Hollywood submarket of Los Angeles. The stabilized portfolio was 94.4% occupied and 96.6% leased. In addition, KRC had three projects under construction totaling approximately 1.3 million square feet of office space that was 37% leased, 801 residential units and 96,000 square feet of retail space that was 91% leased, as well as two projects in the tenant improvement phase totaling approximately 1.2 million square feet of office and PDR space. The office components of the two projects are fully leased to Adobe and Dropbox. The company's commitment and leadership position in sustainability has been recognized by various industry groups across the world. In September 2018, the company was recognized by GRESB both as North American leader across all asset classes and a global leader among all publicly traded real estate companies. Other sustainability accolades include NAREIT's Leader in the Light award for the past five years, the EPA's highest honor of Sustained Excellence and winner of Energy Star Partner of the Year for the past five years. The company is listed in the Dow Jones Sustainability World Index. At the end of the fourth quarter, the company's stabilized portfolio was 63% LEED certified and 79% of eligible properties were ENERGY STAR certified.

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